How are crypto firms responding to US regulators’ enforcement actions?

The Trump administration may be intentionally creating uncertainty in the stock markets to corner Federal Reserve chair Jerome Powell into lowering interest rates, according to a market commentator. Doing so increases the likelihood that the US won’t need to refinance around $7 trillion in debt it owes over the next few months, Bitcoin commentator Anthony Pompliano said in a March 10 X post.US President Donald Trump and Secretary of the Treasury Scott Bessent are “taking matters into their own hands; they’re crashing asset prices in an attempt to force Jerome Powell to cut interest rates,” said Pompliano, who serves as the founder and CEO of Professional Capital Management and host of The Pomp Podcast. In late January, Powell announced the Fed was not lowering interest rates from the current target range of 4.25% to 4.5% despite calls from Trump to do so.Pompliano said the recent market panic has been driven in part by Trump’s tariffs — and has been used to create a more favorable bond market while lowering the 10-year Treasury yield.He noted that the 10-year Treasury yield is already down from nearly 4.8% in January to 4.21% now — a sign that Trump’s purported strategy is “heading in the right direction.”Source: Thomas KralowWhether Pompliano’s theory is correct or not, the stock market has been tanking of late, and crypto has been hit even harder.Broad market index funds such as State Street’s Standard & Poor’s 500 index fund (SPY) fell 2.66% on March 10 alone, while the Nasdaq-100% fell 3.8%, Google Finance data shows.Both indexes are down 7.32% and 10.7% over the last month, while Bitcoin (BTC) is down 27.4% from its $108,786 all-time high, and over $1.2 trillion has been wiped from the cryptocurrency market cap since Dec. 17. If the stock market continues to tank, it will come down to a “who blinks first” contest between Trump and Powell, Pompliano said.While Trump hasn’t confirmed such a strategy, Pompliano pointed to a Fox News interview on March 9 where Trump said: “Nobody ever gets rich when the interest rates are high because people can’t borrow money.”Pompliano added that lowering interest rates would also benefit American consumers:“The big goal, get interest rates down, and that will lead to more economic activity, thanks to access to cheap capital. Give the people cheap capital and they’ll go and do things with it.”Related: Bitcoin dips to $80K in ‘ugly start,’ could retest key resistance: HayesCME FedWatch, a tool used to measure expectations for a Federal Reserve interest rate change, has tipped a 96% probability that the target rate will remain between 4.25% and 4.50% following the Federal Reserve’s next meeting on March 19. However, it’s near 50-50 odds for the target rate to be lowered in the Federal Reserve’s following meeting on May 7.The Federal Reserve typically avoids lowering interest rates when inflation is high, as one of its primary objectives is to maintain price stability.However, a Trump-inflicted recession, or “Trumpcession,” as some call it, could force America’s top bank to start cutting again.Magazine: Meet lawyer Max Burwick — ‘The ambulance chaser of crypto’

A California financial regulator says users reported seven new types of crypto and AI scams that it hadn’t seen before through thousands of complaints in 2024. The California Department of Financial Protection and Innovation (DFPI) said in a March 10 statement that it received 2,668 complaints in 2024 and found seven types of scams they didn’t have on record yet, such as fake Bitcoin (BTC) mining schemes, where fraudsters offer fake investments in mining. The DFPI also received complaints about fake crypto gaming schemes, where users are encouraged to deposit funds only to have their wallets drained, and fraudsters offering fake jobs that require victims to transfer crypto and provide private information.Source: California Department of Financial Protection and InnovationVictims also reported the theft of private keys through fake airdrops, fake investment group scams in WhatsApp or Telegram, AI Investment scams offering unusually high returns and losing their crypto after interacting with certain sham websites. The AI industry experienced significant growth in 2024, reaching a market cap of $638 billion, according to Precedence Research. There was also a notable rise in crimeware-as-a-service (CaaS), where experienced hackers and cybercriminals sell their tools and services to less experienced offenders for a price.DFPI Commissioner KC Mohseni said the regulator is urging caution when interacting with unknown platforms and to “verify website domains to avoid fraudulent imitations, and stay wary of crypto recovery scam sites.”Through its partnership with the State, the DFPI says it shut down more than 26 fraudulent crypto websites and uncovered $4.6 million in user losses last year. California DOJ shuts down 42 crypto scam websitesCalifornia’s Department of Justice (DOJ) took down 42 crypto scam websites in 2024 that stole $6.5 million from victims, with an average loss per person of $146,306.In a March 10 statement, the California DOJ said that because international fraudsters often carry out scams, they are difficult to prosecute and arrest.Common threads among the scam websites were promises of high returns, no contact information, offers of prizes for signing up, and no listings on legitimate crypto industry websites such as CoinMarketCap, the California DOJ said. Related: Crypto lost to exploits, scams, hits $1.5B in February with Bybit hack: CertiKA report from on-chain security firm Cyvers identified pig butchering schemes as one of the most costly in 2024, estimating the scam cost the industry over $5.5 billion across 200,000 identified cases. Meanwhile, blockchain security firm CertiK’s annual Web3 security report flagged crypto phishing attacks, which cost users $1 billion across 296 incidents, as the most significant security threat of 2024.Magazine: Bitcoin’s odds of June highs, SOL’s $485M outflows, and more: Hodler’s Digest, March 2 – 8

The cryptocurrency industry will benefit more from US regulatory clarity than from President Donald Trump’s plan to create a national Bitcoin (BTC) reserve, several cryptocurrency executives told Cointelegraph. Trump’s March 6 executive order creating a US strategic Bitcoin reserve and a separate digital asset stockpile for altcoins left crypto industry executives underwhelmed. Meanwhile, they are still waiting for the White House to provide detailed guidance on issues like securities regulation and taxation, the executives said. “Markets expect a roadmap for innovation and clear guidelines on stablecoins, institutional adoption and taxation,” Max Giammario, CEO of Web3 artificial intelligence startup Kindred, told Cointelegraph.“Instead, the vague rhetoric and lack of immediate action only deepened uncertainty.”Trump signed a crypto executive order on March 6. Source: Margo MartinRelated: Bitcoin reserve backlash signals unrealistic industry expectationsCampaign promisesIn July, Trump promised to turn America into the “world’s crypto capital” and create a US Bitcoin reserve akin to the nation’s gold stockpile. Trump’s March 6 executive order delivered on his campaign promise but left traders disappointed. Instead of instructing the US government to buy crypto, the reserve and the stockpile will initially only comprise digital assets seized by law enforcement. Bitcoin is down approximately 13% from March 6 as traders react to the news amid a backdrop of macroeconomic uncertainty. Altcoins have clocked similar losses, with the total crypto market capitalization shedding more than $400 million. Those losses could worsen without clearer US policy guidance soon, industry executives said.“If Trump’s administration provides clearer regulations on stablecoins, ETFs and institutional adoption, altcoins could regain momentum,” Alvin Kan, chief operating officer of Bitget Wallet, told Cointelegraph.“Otherwise, Bitcoin dominance may continue, as it remains the primary macro asset.”Reasons for optimismEven so, crypto industry executives remain optimistic, citing Trump’s pro-crypto rhetoric and his appointment of industry-friendly leaders to key US regulatory posts. “The future of US crypto policy under Trump remains to be seen,” Theodore Agranat, Gunzilla Games’ director of Web3, told Cointelegraph. “However, given the people in all the crucial positions, we should expect to see a stream of ongoing and positive initiatives and news for crypto in general and especially crypto projects in the US.”Magazine: Legal issues surround the FBI’s creation of fake crypto tokens